Israeli Prime Minister Ehud Olmert has said that there will be no peace unless attacks are halted from all parts of the Palestinian territories, including the Hamas-ruled Gaza Strip. But he said that both sides are very seriously trying to move forward on a deal.

Olmert made the comments after two and a half hours of talks with visiting U.S. President George W. Bush.

Both sides I believe are very seriously trying to move forward with now, in order to realise the vision of a two state solution.

On the first day of his eight-day Mideast trip aimed at pushing the Israelis and Palestinians toward an agreement, Bush declared this was a historic moment and opportunity. But he also said he was under no illusions and that it would be hard work.

And this is an historic opportunity for the world to fight those terrorists. It's an historic opportunity to spread freedom.

U.S. President Bush said that he was seeking a lasting peace between Israel and the Palestinians, which has had a new opportunity.

He also promised to discuss security, freedom and peace throughout the Middle East with leaders in the region.

Meanwhile, violence continued unabated in the Middle East on the first day of Bush's regional visit.

An Israeli strike in northern Gaza killed two Palestinians and injured four others.

The Israeli army said it targeted militants in the area firing projectiles at the rocket-scarred southern Israeli city of Sderot.
In recent weeks, Israel has stepped up its airstrikes and tank-fire attacks against Gaza militants who fire rockets into southern Israel on a daily basis.

While Palestinian militants in the Gaza Strip bombarded southern Israel with rocket and mortar fire on Wednesday, striking a house in a border town of Israel and Gaza.A total of 40 people died after an explosion and fire tore through a logistics centre in Icheon on Monday.